How Tide Detergent Became a Drug Currency

http://nymag.com/news/features/tide-detergent-drugs-2013-1/

Suds for Drugs

Tide detergent: Works on tough stains. Can now also be traded for crack.

A case study in American ingenuity, legal and otherwise.

• By Ben Paynter
• Published Jan 6, 2013

(Photo: Victor Prado/New York Magazine. Typography by Kevin Dresser.)

The call that came in from a local Safeway one day in March 2011 was unlike any the Organized Retail Crime Unit of the Prince George’s County Police Department had fielded before. The grocery store, located in suburban Bowie, Maryland, had been robbed repeatedly. But in every incident the only products taken were bottles—many, many bottles—of the liquid laundry detergent Tide. “They were losing $10,000 to $15,000 a month, with people just taking it off the shelves,” recalls Sergeant Aubrey Thompson, who heads the team. When Thompson and his officers arrived to investigate, they stumbled onto another apparent Tide theft in progress and busted two men who’d piled 100 or so of the bright-orange jugs into their Honda. The next day, Thompson returned to the store’s parking lot to tape a television interview about the crimes. A different robber took advantage of the distraction to make off with twenty more bottles.

Later, Thompson reviewed weeks’ worth of the Safeway’s security footage. He found that more than two dozen thieves, working in crews, were regularly raiding the store’s household-products aisle, sometimes returning more than once the same day and avoiding detection by timing their heists to follow clerks’ shift changes. Owners and managers of other area stores, having seen Thompson on the news, reached out to him to report their own vanishing Tide bottles. Since then, the oddly brand-loyal crime wave has gone national, striking bodegas, supermarkets, and big-box discounters from Austin to West St. Paul, Minnesota. In New York, employees at the Penn Station Duane Reade nabbed a man trying to abscond with Tide bottles he’d stuffed into a suitcase. In Orange County, an attempted Tide theft led to a high-speed chase that included the thief crashing his SUV into an ambulance. Last year, for the first time, detergent made the National Retail Federation’s list of most-targeted items. Says Joseph LaRocca, founder of the trade group RetailPartners, who helped compile the report: “Tide was specifically called out.”

As the cases piled up after his team’s first Tide-theft bust, Thompson sought an answer to the riddle at the center of the crimes: What did thieves want with so much laundry soap? To find out, he and his unit pored over security recordings to identify prolific perpetrators, whom officers then tracked down and detained for questioning. “We never promised to go easy on them, but they were willing to talk about it,” Thompson says. “I guess they were bragging.” It turned out the detergent wasn’t ­being used as an ingredient in some new recipe for getting high, but instead to buy drugs themselves. Tide bottles have become ad hoc street currency, with a 150-ounce bottle going for either $5 cash or $10 worth of weed or crack cocaine. On certain corners, the detergent has earned a new nickname: “Liquid gold.” The Tide people would never sanction that tag line, of course. But this unlikely black market would not have formed if they weren’t so good at pushing their product.

Shoppers have surprisingly strong feelings about laundry detergent. In a 2009 survey, Tide ranked in the top three brand names that consumers at all income levels were least likely to give up regardless of the recession, alongside Kraft and Coca-Cola. That loyalty has enabled its manufacturer, Procter & Gamble, to position the product in a way that defies economic trends. At upwards of $20 per 150-ounce bottle, Tide costs about 50 percent more than the average liquid detergent yet outsells Gain, the closest competitor by market share (and another P&G product), by more than two to one. According to research firm SymphonyIRI Group, Tide is now a $1.7 billion business representing more than 30 percent of the liquid-detergent market.

Before the advent of liquid detergent, the average American by one estimate owned fewer than ten outfits, wearing items multiple times (to keep them from getting threadbare too fast) before scrubbing them by hand using bars of soap or ground-up flakes. To come up with a less laborious way to do the laundry, executives at Procter & Gamble began tinkering with compounds called surfactants that penetrate dirt and unbond it from a garment while keeping a spot on a shirt elbow from resettling on the leg of a pant. When the company released Tide in 1946, it was greeted as revolutionary. “It took something that had been an age-old drudgery job and transformed it into something that was way easier and got better results,” says Davis Dyer, co-author of Rising Tide, which charts the origins of the brand. “It was cool, kind of like the iPod of the day.” Procter & Gamble, naturally, patented its formula, forcing competitors to develop their own surfactants. It took years for other companies to come up with effective alternatives.

While clothes were getting easier to clean, Americans were starting to own more of them. Today, journalist Elizabeth Cline reports in Overdressed: The Shockingly High Cost of Cheap Fashion, the average U.S. consumer buys 68 pieces of clothing a year—more than one purchase a week—much of it cheaply made. Launder those items with Tide, and they take on a uniform smell and feel that consumers have come to associate with quality. “It doesn’t matter where the clothes come from, if you wash them with Tide, they do have almost this prestige wash to them,” says Maru Kopelowicz, a global creative director at Saatchi & Saatchi, which researches consumer attitudes toward Tide as the brand’s lead advertising firm.

Procter & Gamble spends heavily on research and development to continually ­refine the sensory by-products of doing the laundry with its leading detergent. Tide’s original scent was “citruslike,” in the words of Sundar Raman, the marketing director of Procter & Gamble’s North American fabric-care division, but has evolved into a “citrus, floral, and fruity experience” with hints of lemon, orange, roses, lily, and apple. When combined in a complex perfume, these notes help cover up the odors of the cleaning agents that would otherwise waft out during the wash cycle. But P&G also chose each scent to do a specific job. The smell of citrus, for instance, has been shown to correlate strongly with perceptions of cleanliness. “That natural, fresh-and-clean smell is stimulating and creates an instantaneous mood of being happy,” says Craig Warren, a former researcher for the firm International Flavors & Fragrances who, until the late nineties, did work with P&G. Floral scents, for their part, have been known to evoke strong feelings of maternal love and kinship. (Home visits by Saatchi researchers have found that very ardent Tide fans sometimes carry bottles as if cradling a baby.) The goal of all these efforts is to turn clothes-washing into more than a to-do; it’s being a good parent, a good person. It’s a message that may also explain why among some lower-income shoppers, according a 2012 newsletter by branding agency Daymon Worldwide, “being able to afford Tide laundry detergent is seen as a sign of success.”

Once people pick a brand, their reasons for sticking with it are largely automatic. Read Montague is the director of the ­human-neuroimaging laboratory and ­computational-psychiatry unit at Virginia Tech’s Carilion Research Institute, where he studies how people choose and value products using an fMRI machine. When shoppers are exposed to a brand they identify with, their ventral medial prefrontal cortex lights up—the same part of the brain associated with reward recognition in drug users. That neural pathway may have helped our ancestors remember, say, which plants were safe to eat or when a tribal marking meant a clan was worth avoiding. In the modern age, we use the same circuitry as a shortcut for more mundane decisions. “As long as it keeps paying you back the same way,” Montague says, you buy the same brands. The feedback loop flashes: “It’s worth the money.”

The criminal cost-­benefit ­analysis of a bottle of Tide is more straightforward. Most of the people stealing the detergent, Sergeant Thompson points out, are the same criminals who used to break into houses or mug pedestrians—male addicts whose need to feed their habits can foster a kind of innovative streak. “They are smart. They are creative. They want high reward and low risk,” he says. Theft convictions can come with a maximum fifteen-year prison sentence, but the penalty for shoplifting is often just a small fine, with no jail time. For the most active thieves, says Thompson, stolen Tide has in some ways become more lucrative than the drugs it’s traded for. “It’s the new dope,” he says. “You can get richer and have less chance of doing jail time.”

For stores, stopping Tide shoplifting presents unique challenges. Most frequently stolen goods—GPS devices, smartphones, and other consumer electronics—are pricey, light, and easily concealed. They’re also not routine purchases, which means they can be locked up until buyers ask for them. Bulk goods like detergent are harder to run off with, but they’re also bought by dozens of customers daily—lock those products up, and a store manager adds more time to his customers’ errand runs, potentially sending them to shop elsewhere. “Any time you secure something, it impacts the sale of that item at some level,” says Jerry Biggs, the director of Walgreens’ Organized Retail Crime Division.

Nor is relying on clerks to head off suspected thieves a realistic option. Cashiers and stockists, working for low pay, are often disinclined to confront a potential criminal. “People at the cash register don’t stop you,” says one of Thompson’s informants, an ex-con who shoplifted for years. “They just let you go past.” What’s more, stolen bottles of Tide aren’t easily traceable. Many merchants don’t record the lot and batch numbers for most grocery-store products, because that takes precious man hours. And Procter & Gamble has not made its own database of that information publicly available. Some stores have tried attaching tracking stickers to bottles to establish their provenance, only to find that thieves just wash them off.

In his investigation, Thompson realized that since the supply of Tide would be hard to curb, he had to figure out how to stem the illicit demand. Working from leads provided by inmates and parolees offering to share details about their own Tide dealings in exchange for a good word with their judge or parole officer, he and his fellow officers pieced together a loose network of middlemen—barbershops, nail salons, and drug houses that were taking in bottles to either sell on the side to their clients or at a deep discount to willing corner stores and pawn shops.

Despite its popularity, Tide is not a big moneymaker for stores. P&G’s proprietary surfactants and enzymes are relatively expensive to produce, notes Bill Schmitz, a Deutsche Bank analyst, so Tide’s wholesale cost is steep. Only so much of that can be passed on to customers. “It’s so tight,” says Schmitz of the profit margin. In general, a retailer clears just a few percentage points on a Tide purchase. A store that charges $19.99 for a 150-ounce bottle might claim $2 in profit. But if it buys stolen bottles for $5, that jumps to $15.

It’s not just bodegas that hawk iffy product. Chain stores also wind up in resale schemes. Rather than stock large surpluses of popular items, those businesses often rely on so-called perpetual-inventory systems to electronically record sales data and relay it to manufacturers, which stagger deliveries accordingly. When a bottle of Tide is taken from a store without being rung up, a crucial step gets skipped, leading to shipment delays. And when that happens, some store managers place stopgap orders with local wholesalers who may be less than rigorous about where they obtain their products or from fencing rings that employ their own sales teams and maintain legitimate-looking websites. “Some stores might not recognize these goods as stolen, but others don’t really care,” says LaRocca. “There are [stores] who don’t ask questions about where the goods originated. Plenty are just looking to fill their shelves.”

To break that final link in the chain, Thompson and his unit needed to nail stores for buying and selling boosted product—and to prove they were moving enough of it to trigger sufficiently dissuasive penalties. Prosecutors have to base charges on the retail value of the stolen merchandise. In Maryland, if the total is less than $1,000, the crime is a misdemeanor. Above that threshold, it becomes a felony, and a perpetrator faces the possibility of years behind bars. After his team busted one area shop owner for taking in stolen Tide, the perpetrator struck a deal for a $250 fine and a form of probation—then turned around and raised the price his store charged for Tide by $3.

During a sting operation last June, Thompson tried a new tactic. On a muggy Friday, the sergeant, clad in a black tracksuit, pulled his unmarked cruiser into a run-down shopping center in Capitol Heights, a low-income neighborhood on the southwestern border of Prince George’s County and Washington, D.C. The previous week, one of his tipsters called about seeing people lugging Tide into his target today, a ­salon called Star Nails.

Thompson watched as his team, two undercover cops in a Jeep Cherokee, pulled up to the shop, where a handful of people in ragged clothing were loitering under a faded red-and-white marquee. While the driver kept the car idling, a heavily tattooed, spiky-haired detective named Alexander Mallari jumped out holding a laundry bag filled with a few bottles of Tide and lots of bonus items—a dozen pairs of Philips earphones, a dozen or so bottles of Victoria’s Secret perfume. Mallari’s mission was simple: He’d enter the shop, disclose that the items were stolen, and try to unload them.

Ten minutes later, Mallari emerged with an empty bag and a small wad of money in his pocket. He was offered just $30—a pittance by the standards of the Tide trade. “That’s a true crackhead price right there,” Thompson said. Mallari could have haggled for more, but that’s not the point, since it’s the retail prices of the merchandise that will be making the police report, and the headphones and perfume helped to boost the total value into felony territory. “As long as they pay me, as long as they accept the stolen item, that’s what matters,” he said. A few weeks later, the team raided the salon and two houses and a pair of cars associated with Star Nails employees, arresting five workers and recovering roughly $20,000 in stolen property. While they had the salon under surveillance, Thompson’s unit learned that the scope of Tide theft had broadened again. An officer overheard its employees talking about moving the Tide to stores “back home”—which in their case is Vietnam.

For its part, Procter & Gamble doesn’t seem overly concerned about the black-market popularity of its product. “It’s unfortunate that people are stealing Tide, and I don’t think it’s appropriate at all, but the one thing it reminds me of is that the value of the brand has stayed consistent,” says Raman, the marketing director. Now the company’s tactics for maintaining the brand’s premium status are evolving. One recent commercial for the detergent shows a young couple watching TV. The boyfriend mentions that his girlfriend wanted him to use Tide with Downey to make his shirts soft. The punch line: She’s fallen asleep on his stomach. “And was she right? The proof is in the snoring,” he says. That promotion, part of a campaign called MyTide, is emblematic of the way Tide’s target demographic has expanded since the brand’s inception. Tide isn’t just for stay-at-home moms anymore. It’s for single guys—and, as other commercials show, for a woman who wants to resurrect her “nasty, vile” old tennis shoes, or the parents of triplets, folding clothes in a crowded bedroom, who consider their kids “such a blessing” but “not financially,” or anyone looking to stretch their dollars. Says Kopelowicz of Saatchi & Saatchi: “Some people, just because they can’t afford Tide all the time, they might think the brand doesn’t understand you. Of course we understand you.”

Fashion trends might be ephemeral, but—if you buy into Tide’s branding efforts—clean clothes, no matter what kind of clothes they are, are essential to your well-being, or even to your sense of self-worth. “It makes you feel prepared, like your priorities are straight,” Kopelowicz says. It just happens that the high demand for Tide that message fuels also sustains criminal enterprises.

If all that makes Thompson’s job harder, he doesn’t blame Procter & Gamble. “I’m a No. 1 Tide fan,” he says. “I don’t know if it’s all psychological, but you can tell the difference.”